Euro area and EU28 government deficit at 1.5% and 1.7% of GDP respectively

Euro area and EU28 government deficit at 1.5% and 1.7% of GDP respectively

Euro area and EU28 government deficit at 1.5% and 1.7% of GDP respectively

The FINANCIAL -- In 2016, the government deficit and debt of both the euro area (EA19) and the EU28 decreased in relative terms compared with 2015. In the euro area the government deficit to GDP ratio fell from 2.1% in 2015 to 1.5% in 2016, and in the EU28 from 2.4% to 1.7%.

In the euro area the government debt to GDP ratio declined from 90.3% at the end of 2015 to 89.2% at the end of 2016, and in the EU28 from 84.9% to 83.5%.

In this release, Eurostat, the statistical office of the European Union, is providing government deficit and debt data based on figures reported in the first 2017 notification by EU Member States for the years 2013-2016, for the application of the excessive deficit procedure (EDP). This notification is based on the ESA 2010 system of national accounts. This release also includes data on government expenditure and revenue.

In 2016, Luxembourg (+1.6%), Malta (+1.0%), Sweden (+0.9%), Germany (+0.8%), Greece (+0.7%), the Czech Republic (+0.6%), Cyprus and the Netherlands (both +0.4%), Estonia and Lithuania (both +0.3%) registered a government surplus, while Bulgaria and Latvia reported a government balance. The lowest government deficits as a percentage of GDP were recorded in Ireland (-0.6%), Croatia (-0.8%) and Denmark (-0.9%). Four Member States had deficits equal to or higher than 3% of GDP: Spain (-4.5%), France (-3.4%), Romania and the United Kingdom (both -3.0%).

At the end of 2016, the lowest ratios of government debt to GDP were recorded in Estonia (9.5%), Luxembourg (20.0%), Bulgaria (29.5%), the Czech Republic (37.2%), Romania (37.6%) and Denmark (37.8%). Sixteen Member States had government debt ratios higher than 60% of GDP, with the highest registered in Greece (179.0%), Italy (132.6%), Portugal (130.4%), Cyprus (107.8%) and Belgium (105.9%).

In 2016, government expenditure in the euro area was equivalent to 47.7% of GDP and government revenue to 46.2%. The figures for the EU28 were 46.6% and 44.9% respectively. In both zones, the government expenditure ratio decreased between 2015 and 2016, while the government revenue ratio decreased in the euro area and remained stable in the EU28.

Reservations on reported data

Luxembourg: Eurostat is expressing a reservation on the quality of the data reported by Luxembourg in relation to the sector classification of hospitals, as well as a number of technical issues such as the recording of receivables and payables, the size of statistical discrepancies in the EDP tables and the unavailability of data for local government. Eurostat will investigate these issues with the Luxembourgish statistical authorities.

Belgium: Eurostat is maintaining the reservation on the quality of the data reported by Belgium in relation to the sector classification of hospitals. Eurostat considers that, in line with ESA 2010, government controlled hospitals in Belgium should be classified inside government. This is currently not the case. A future reclassification will most likely result in a limited increase in government debt.

Hungary: Eurostat is maintaining the reservation on the quality of the data reported by Hungary in relation to the sector classification of Eximbank (Hungarian Export-Import Bank plc). Eurostat considers that Eximbank should be reclassified inside the general government sector which will result in an increase in government debt. Moreover, Eurostat is discussing with the Hungarian statistical authorities the possible rerouting of operations carried out by the Hungarian National Bank and its Foundations, deemed to be undertaken on behalf of government, as well as the reclassification inside the general government sector of certain entities (such as National Resolution Fund, National Deposit Insurance Fund and all their subsidiaries, MARK Hungarian Restructuring and Debt Management plc).

Cyprus: Eurostat is withdrawing the reservations on the quality of the data reported by Cyprus in relation to a series of technical issues which had not been clarified in a satisfactory manner during the October 2016 data assessment.